text: This title shall be known, and may be cited, as the California Combating Auto Retail Scams (CARS) Act.

history: (History: Added by Stats. 2025, Ch. 354, Sec. 1. (SB 766) Effective January 1, 2026. Operative October 1, 2026, pursuant to Section 1784.28.)

path: 1.5B. California Combating Auto Retail Scams (CARS) Act > 1. General Provisions


kind: section

code: CIV

text: Any waiver by a consumer of the provisions of this title is contrary to public policy and is unenforceable and void.

title: 1.5B. California Combating Auto Retail Scams (CARS) Act

chapter: 1. General Provisions


text: The provisions of this title are not exclusive. The remedies provided in this title for a violation of this title or for conduct proscribed by this title shall be in addition to any other remedies available under other law. This title does not limit or alter the remedies and liabilities set forth in other laws that may apply.


text: If any provision of this title or the application of this title to any person or circumstance is held to be unconstitutional or otherwise deemed to be invalid, the remainder of the title and the application of the provision to other persons or circumstances shall not be affected.


text: This title shall become operative on October 1, 2026.

history: (History: Added by Stats. 2025, Ch. 354, Sec. 1. (SB 766) Effective January 1, 2026.)


text: This title shall be liberally construed and applied to promote its underlying purposes, which are to protect purchasers and lessees of new or used motor vehicles against unfair and deceptive business practices and to provide efficient and economical procedures to secure that protection.

chapter: 2. Construction and Definitions

path: 1.5B. California Combating Auto Retail Scams (CARS) Act > 2. Construction and Definitions


text:
The following definitions apply for purposes of this title:

(a) “Add-on” or “add-on product or service” means any product or service not provided to the purchaser or lessee or installed on the vehicle by the vehicle manufacturer and for which the dealer, directly or indirectly, charges a purchaser or lessee in connection with a vehicle sale, lease, or financing transaction.

(b) “Auction” means a sale transaction conducted by means of oral, written, or electronic exchanges whereby offers are solicited from one or more potential purchasers in the form of bids in an effort to advance the amount of the bids to obtain the highest and most favorable offer.

(c) “Dealer” means a licensed California motor vehicle dealer or a dealer as defined in Section 285 of the Vehicle Code.

(d) “GAP agreement” means an agreement for either of the following:

(1) To indemnify a vehicle purchaser or lessee for the difference between the actual cash value of the vehicle in the event of an unrecovered theft or total loss and the amount owed on the vehicle pursuant to the terms of a loan, lease agreement, or installment sales contract used to purchase or lease the vehicle.

(2) To waive the unpaid difference between money received from the purchaser’s or lessee’s vehicle insurer and some or all of the amount owed on the vehicle at the time of the unrecovered theft or total loss, including products or services titled “guaranteed automobile protection agreement,” “guaranteed asset protection agreement,” “GAP insurance,” or “GAP waiver.”

(e) “Material” or “materially” means likely to affect a person’s choice of, or conduct regarding, goods or services.

(f) (1) “Motor vehicle” or “vehicle” means a motor vehicle as defined by Section 415 of the Vehicle Code.

(2) Notwithstanding paragraph (1), “motor vehicle” or “vehicle” does not include any of the following:

(A) Vehicles that are sold wholesale. For purposes of this subparagraph, “wholesale” means sale of a vehicle that does not constitute a retail sale, as defined in Section 6007 of the Revenue and Taxation Code.

(B) Vehicles that are not required to be registered under the Vehicle Code.

(C) Fleet sale transactions. For purposes of this subparagraph, “fleet sale” means the sale of more than one vehicle as part of a single transaction for use primarily for business or commercial purposes.

(D) Sales to commercial purchasers. For the purposes of this subparagraph, “commercial purchasers” means a person that purchases five or more vehicles from the dealer per year for use primarily for business or commercial purposes.

(E) A vehicle that has a gross vehicle weight rating of 10,000 pounds or more.

(g) “Restocking fee” means the following fees that the dealer may charge a buyer or lessee who exercises the three-day right to cancel:

(1) (A) One and one-half percent of the sale price of the vehicle, but not less than two hundred dollars ($200) and not more than six hundred dollars ($600).

(B) In lieu of the fee in subparagraph (A), a dealer that charged the buyer or lessee a shipping fee for transporting the vehicle may retain the cost the dealer actually incurred for shipping, provided that the amount retained does not exceed the amount that would otherwise be permitted under subparagraph (A). The dealer shall refund to the buyer or lessee the balance, if any, between the amounts charged and retained.

(2) If the vehicle has been driven over 250 miles, the dealer may also charge the buyer or lessee an additional one dollar ($1) for each mile over 250 miles, but this amount shall not exceed one hundred fifty dollars ($150).

(h) “Service contract” includes products that provide consumers with some type of benefit or payment for repair, maintenance, or service on the vehicle purchased or leased.

(i) (1) “Three-day,” as used in the phrase “three-day right to cancel,” means the period in which a buyer or lessee of a used vehicle may exercise the right to cancel the purchase or lease as provided in Section 1784.43. Except as provided in paragraph (2), this period consists of the three calendar day period commencing the calendar day after the purchase or lease is executed.

(2) If the third day in the three calendar day period described in paragraph (1) falls on a day the dealership is closed to the public, the three-day right to cancel period extends to the next day the dealership is open to the public.

(3) The three-day right to cancel ends at the close of business on the last day of the period described in this subdivision.

(j) (1) “Total price” means the total sale price of a vehicle, excluding the taxes, fees, and charges described in subdivision (e) of Section 11713.1 of the Vehicle Code.

(2) “Total price” includes any dealer price adjustment and the cost of any item installed on the vehicle at the time of the advertisement or communication.

(3) “Total price” does not include any deduction for a rebate.

(k) (1) “Used motor vehicle” or “used vehicle” means a vehicle, as defined by subdivision (f), that also satisfies the definition of a “used vehicle” as defined in Section 665 of the Vehicle Code.

(2) “Used motor vehicle” does not include a motorcycle, as defined in Section 400 of the Vehicle Code.


text:
It is a violation of this title for any dealer to make any misrepresentation regarding material information about any of the following:

(a) The costs or terms of purchasing, financing, or leasing a vehicle.

(b) Any costs, limitation, benefit, or any other aspect of an add-on product or service.

(c) Whether the final contract is for the lease or sale of a motor vehicle. This subdivision shall not be construed to restrict the ability of a dealer to present multiple financing and lease payment options to the customer prior to the sale or lease of a motor vehicle.

(d) The availability of vehicles at a total price communicated by the dealer. A dealer is not in violation of this subdivision if the advertisement in question is withdrawn following the sale of the vehicle in compliance with subdivision (c) of Section 11713 of the Vehicle Code.

(e) Whether any consumer has been or will be preapproved or guaranteed for any product, service, or term.

(f) Information on or about a consumer’s application for financing.

(g) Whether the dealer will keep cash downpayments or trade-in vehicles, charge fees, or initiate legal process, or any action if a transaction is not finalized or if the consumer does not go forward with the transaction.

(h) Whether, and if so, when, a dealer will pay off some or all of the financing or a lease on a consumer’s trade-in vehicle, and what happens if a dealer fails to pay off the trade-in vehicle within the time period required by Section 11709.4 of the Vehicle Code.

(i) The remedy available if a dealer fails to sell or lease a vehicle at the total price.

(j) Whether the dealer or any of the dealer’s personnel or products or services is or was affiliated with, endorsed or approved by, or otherwise associated with the United States government or any federal, state, or local governmental agency, unit, or department, including the United States Department of Defense or its military departments.

(k) Whether, or under what circumstances, a vehicle may be repossessed.

(l) Whether a vehicle can be moved outside of California or outside of the United States.

(m) Any of the required disclosures identified in this title.

path: 1.5B. California Combating Auto Retail Scams (CARS) Act > 3. Prohibited Conduct and Consumer Rights


text:
It is a violation of this title for any dealer to fail to make any disclosure required by this section clearly and conspicuously.

(a) In connection with the sale or financing of a vehicle, a vehicle’s total price shall be disclosed as follows:

(1) In any advertisement that references a specific vehicle for sale.

(2) In any advertisement that represents any monetary amount or financing term for a specific vehicle.

(3) In the first written communication with a consumer that includes a reference regarding a specific vehicle for sale, or any monetary amount or financing term for any vehicle. With respect to the first written communication, both of the following apply:

(A) The total price for the vehicle shall be disclosed at least once in the dealer’s first response regarding that specific vehicle to the consumer.

(B) A dealer shall retain a copy of the communication identified by this paragraph for at least two years and shall provide a copy of the communication to the customer upon written request.

(b) When making any written representation during the negotiation to purchase or lease a specific vehicle about an add-on product or service, the dealer shall disclose at least once that the add-on is not required and the consumer can purchase or lease the vehicle without the add-on. This disclosure shall be in writing and shall be clear and conspicuous. If the transaction is negotiated primarily in a language identified by subdivision (b) of Section 1632, the disclosure required by this paragraph shall also be provided in that language.

(c) (1) When making any written representation during the negotiation to purchase or lease a specific vehicle about a monthly payment for any vehicle, the dealer shall disclose at least once, clearly and conspicuously and in writing, the total amount the consumer will pay to purchase or lease the vehicle at that monthly payment after making all payments as scheduled.

(2) If the total amount disclosed assumes the consumer will provide consideration, including in the form of a cash downpayment or trade-in valuation, the dealer shall disclose the amount of consideration to be provided by the consumer. This disclosure shall be in writing and shall be clear and conspicuous. If the transaction is negotiated primarily in a language identified by subdivision (b) of Section 1632, the disclosure required by this paragraph shall also be provided in that language.

(d) If the dealer makes any written comparison between payment options during the negotiation to purchase or lease a specific vehicle that includes discussion of lower monthly payments, the dealer shall disclose that lower monthly payments often increase the total amount the consumer will pay to purchase or lease the vehicle. Use of an internet-based tool that allows consumers to adjust financing parameters shall not constitute a violation of this section.

(e) The disclosures required by subdivisions (b), (c), and (d) may be incorporated into a document that includes the written disclosures required by Section 2982.2.

(f) Subdivision (a) shall not be construed to modify vehicle advertising requirements in Section 11713.1 or Section 11713.16 of the Vehicle Code. This includes, but is not limited to, the advertisement or communication of rebates and incentives that are disclosed separately from a vehicle’s total price.

(g) This section shall not apply to a used vehicle sold at an auction.

chapter: 3. Prohibited Conduct and Consumer Rights


text:
It is a violation of this title for any dealer, in connection with the sale or financing of vehicles, to charge for any of the following.

(a) A dealer may not charge for an add-on product or service if the vehicle purchaser or lessee would not benefit from the add-on product or service, including, as applicable, any of the following:

(1) Nitrogen-filled tire-related products or services that contain less than 95-percent nitrogen purity.

(2) Products or services that do not provide coverage for the vehicle, the consumer, or the transaction.

(3) A GAP agreement that is not in compliance with Section 2982, 2982.2, or 2982.12.

(4) A service contract if the service contract is void due to preexisting conditions, including prior damage from a crash or flood or preexisting mechanical conditions.

(5) Oil changes for electric vehicles.

(6) Catalytic converter markings for a vehicle that does not have a catalytic converter.

(7) Surface protection product that renders the manufacturer’s warranty for the paint job void.

(b) A dealer shall pay the person or entity who is supposed to provide the benefit of the add-on within 10 days of the date when the car buyer or lessee signs the purchase or lease, unless the dealer has an agreement with the person or entity that provides for payment at a later date and the buyer’s or lessee’s coverage is not impacted by the later payment.

(c) This section does not prohibit a dealer from charging for an add-on product or service, such as a service contract, if the add-on product or service is selected by, and would benefit, the vehicle purchaser or lessee, even if the vehicle purchaser or lessee ultimately does not choose to use the add-on product or service, and even if the vehicle purchaser or lessee does not use the add-on product or service because a coverage event does not occur.


text:
(a) (1) (A) A dealer shall not sell or lease a used vehicle at retail at a price equal to or less than fifty thousand dollars ($50,000) without providing the buyer or lessee with a three-day right to cancel the purchase or lease.

(B) The right to cancel does not apply if the used vehicle has been driven more than 400 miles between the execution of the sale or lease agreement and the date on which the buyer or lessee attempts to exercise the right.

(2) (A) A dealer may charge a buyer or lessee who exercises the right to cancel a restocking fee. Except as provided in subparagraph (B), the dealer may collect the restocking fee on the date the buyer or lessee exercises the right to cancel.

(B) (i) If the buyer or lessee is entitled to any refund, the restocking fee shall be deducted from the refund.

(ii) If the refund does not cover the full amount of the restocking fee, the balance is due at the time the buyer or lessee exercises the right to cancel.

(3) (A) If the right to cancel is exercised, the dealer shall return the buyer’s or lessee’s trade-in vehicle and all keys the buyer or lessee provided, if any, unless the dealer has sold or otherwise initiated the process to transfer the title of the trade-in vehicle, in which case the refund for the trade-in vehicle is the greater of the following:

(i) The agreed-upon value of the trade-in vehicle in the sales or lease agreement.

(ii) The amount for which the dealer sold the trade-in vehicle.

(iii) The fair market value of the trade-in vehicle.

(B) The dealer may deduct from the amount required by subparagraph (A) the amount necessary to satisfy outstanding indebtedness secured by the trade-in vehicle. The dealer shall provide the buyer or lessee a receipt documenting the cancellation that includes an itemized breakdown of the basis for each deduction. The receipt shall include the date and time when the buyer or lessee exercised the right to cancel.

(C) For the purposes of clause (iii) of subparagraph (A), the dealer shall have a rebuttable presumption of establishing the fair market value by either of the two valuation methods:

(i) The valuation equals the amount identified in a written offer to purchase the trade-in vehicle received by the buyer or lessee, and honored by the dealer, and that offer is valid for at least seven days.

(ii) The valuation equals the vehicle’s trade-in valuation when the right to cancel was exercised, as identified in a nationally recognized pricing guide selected by the dealer, and considering the vehicle’s condition at the time the vehicle was traded in. For the purposes of this clause, “nationally recognized pricing guide” has the same meaning as paragraph (2) of subdivision (c) of Section 11950 of the Vehicle Code.

(b) Notwithstanding Section 2981.9 of the Civil Code, a dealer shall provide the buyer or lessee of a used vehicle subject to the right to cancel a copy of a disclosure titled “3-Day Right to Cancel Used Car Purchase or Lease” on a separate document. If the transaction is negotiated primarily in a language identified by subdivision (b) of Section 1632, the disclosure required by this subdivision shall also be provided in that language. The disclosure shall clearly and conspicuously contain all of the following:

(1) The name of the selling or leasing dealer and the buyer or lessee.

(2) A description and the vehicle identification number of the vehicle purchased.

(3) A statement specifying the time within which the buyer or lessee must exercise the right to cancel the sale or lease and return the vehicle to the dealer.

(4) A statement that although the dealer cannot charge the buyer or lessee for the right to cancel the purchase or lease, the dealer may charge the buyer or lessee a restocking fee. The statement shall describe how both components of the restocking fee are calculated.

(5) A statement that the buyer or lessee cannot exercise the right to cancel if the vehicle has been driven more than 400 miles.

(6) A statement that the right to cancel applies only if all of the following are personally delivered to the selling or leasing dealer during business hours by the buyer or lessee at the time the right to cancel is exercised:

(A) Restocking fees, except to the extent they are deducted from any refund as required by this section.

(B) The vehicle, meeting both of the following:

(i) Free of all liens and encumbrances, other than any lien or encumbrance created by or incidental to the sales or lease transaction.

(ii) In the same condition as when it was delivered by the dealer to the buyer or lessee, except reasonable wear and tear and any defect or mechanical problem that manifests or becomes evident after delivery that was not caused by the buyer or lessee. The dealer shall maintain documentation describing any damage beyond reasonable wear and tear.

(C) Any other cash or items received by the buyer or lessee in connection with the sale or lease of the vehicle.

(7) A statement that the dealer may require the buyer or lessee to execute documents reasonably necessary to effectuate the cancellation and refund and as reasonably required to comply with applicable law.

(8) (A) A statement that if the dealer has sold or otherwise initiated the process to transfer title of the buyer’s or lessee’s trade-in vehicle, the dealer shall pay the buyer or lessee the greater of the following:

(i) The agreed-upon value of the trade-in vehicle in the sales or lease agreement.

(ii) The amount for which the dealer sold the trade-in vehicle.

(iii) The fair market value of the trade-in vehicle.

(B) A statement that the amount of the refund may be reduced as necessary to satisfy outstanding indebtedness secured by the trade-in vehicle.

(9) A statement that if the dealer represents to the buyer or lessee that it sold the trade-in vehicle, it must provide the buyer or lessee a copy of the document showing the sale of the trade-in vehicle. The dealer shall redact the personal information of the person or entity to whom the trade-in vehicle was sold.

(c) It is a violation of this title for any dealer, in connection with a buyer or lessee exercising the right to cancel, to do any of the following:

(1) Anything to impede a buyer or lessee from exercising the right to cancel the purchase or lease of a vehicle as provided in this title.

(2) Overcharge the buyer or lessee for the restocking fee.

(3) Withhold the buyer’s or lessee’s downpayment or trade-in vehicle after the right to cancel has been exercised.

(4) Fail to timely refund the buyer’s or lessee’s downpayment after the right to cancel has been exercised.

(5) Fail to refund the amount owed for the buyer’s or lessee’s trade-in vehicle if the trade-in vehicle has been sold.

(6) Fail to provide the buyer or lessee the receipt or contract for the sale of the buyer’s or lessee’s trade-in vehicle.

(7) Claim damage to the vehicle in excess of reasonable wear and tear without reasonable basis.

(8) Claim the person authorized to return the buyer’s or lessee’s downpayment or trade-in vehicle is not available.

(d) (1) No later than 48 hours after the buyer or lessee exercises the right to cancel pursuant to this section, the dealer shall cancel the contract and provide the buyer or lessee with a full refund, minus any deduction allowed by this section. The dealer is not responsible for any delays outside the control of the dealer, including delays attributable to the processing of a refund by a bank, credit card company, or other financial institution.

(2) Notwithstanding paragraph (1), in the event the buyer or lessee made a payment through a method that does not result in an immediate verified transfer of funds to the dealer, such as a check, the dealer may delay providing the refund until two business days after the buyer or lessee’s payment is verified. The dealer shall provide the buyer or lessee with documentation showing when the verification occurred.

(e) The dealer will clearly and conspicuously disclose on the first page of the purchase or lease agreement the following: “CALIFORNIA DOES NOT HAVE A COOLING-OFF PERIOD FOR NEW VEHICLES. HOWEVER, IF YOU PURCHASED OR LEASED A USED VEHICLE FOR $50,000 OR LESS, YOU HAVE 3 DAYS TO CANCEL THIS CONTRACT FOR ANY REASON. ADDITIONAL RESTRICTIONS MAY APPLY, INCLUDING A RESTOCKING FEE. You have up to 3 days to return the vehicle to the dealer and cancel this contract and obtain a refund. Please review the disclosure, which the dealer is required by law to provide, for the details about this right and how to exercise it.” (f) This section does not affect the ability of a buyer to rescind the contract or revoke acceptance under any other law.

(g) This section does not apply to a used vehicle with a purchase price greater than fifty thousand dollars ($50,000).

(h) This section does not apply to the sale of a leased vehicle to the lessee if the lessee is in possession of the vehicle prior to the time of the sale.

(i) This section does not apply to a used vehicle sold at an auction, provided the used vehicle is in compliance with the requirements of Division 12 (commencing with Section 24000) of the Vehicle Code.

(j) This section shall not be construed to limit the ability of a dealer to offer a right to cancel that provides greater consumer protections than those outlined in this section, including a right to cancel for additional vehicles, a longer return period, or reduced restocking fees. In such circumstances, the dealer may elect to make corresponding changes that describe these greater consumer protections in any consumer notice required by this section or Section 11709.2 of the Vehicle Code.


text:
(a) A dealer subject to this title shall create and retain, for a period of two years from the date the record is created, all records necessary to demonstrate compliance with this title, including the following records:

(1) Records demonstrating that communications and advertisements of a vehicle’s total price meet the requirements of subdivision (a) of Section 1784.41. For purposes of this paragraph, “advertisement” includes internet-based listings that display a vehicle’s total price, features, or financing terms disseminated by the dealer. This paragraph shall not require retention of records generated solely by interactive tools that allow consumers to adjust variables such as downpayment, credit tier, interest rate, or loan term to receive personalized financing estimates, provided the tools do not alter or misrepresent the vehicle’s total price as advertised.

(2) Copies of all purchase orders, financing and lease documents with the dealer signed by the consumer, whether or not final approval or assignment of the contract is received from a financing or lease transaction, and all written communications relating to sales, financing, or leasing between the dealer and any car buyer or lessee who signs a purchase order or financing or lease contract with the dealer.

(3) Records demonstrating that add-ons in a consumer’s contract meet the requirements of Section 1784.42, including copies of all service contracts, GAP agreements, proof of timely payment for add-ons, and calculations of loan-to-value ratios in contracts including GAP agreements.

(4) Copies of all cancellation requests, proof of refunds of downpayments or other consideration provided in the purchase of a vehicle, and proof of return of trade-in vehicles.

(5) Copies of all written complaints sent by car buyers or lessees to the dealer relating to sales, financing, leasing, or cancellation requests under Section 1784.43, written inquiries related to add-ons, and written inquiries and responses about vehicles referenced in Section 1784.41. For the purposes of this paragraph, “complaints” does not include responses to customer surveys or reviews, or testimonials posted on the internet.

(b) A dealer subject to this part may keep the records required by subdivision (a) in any legible form, and in the same manner, format, or place as they already keep records in the ordinary course of business. Failure to keep all records required under subdivision (a) is a violation of this title.

(c) This section does not limit the requirements imposed by Section 2984.5.


text:
The Legislature finds and declares as follows:

(a) An elaborate mechanism has been developed for investigating and evaluating the credit worthiness, credit standing, credit capacity, and general reputation of consumers.

(b) Consumer credit reporting agencies have assumed a vital role in assembling and evaluating consumer credit and other information on consumers.

(c) There is a need to insure that consumer credit reporting agencies exercise their grave responsibilities with fairness, impartiality, and a respect for the consumer’s right to privacy.

(d) It is the purpose of this title to require that consumer credit reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, hiring of a dwelling unit, and other information in a manner which is fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevancy, and proper utilization of such information in accordance with the requirements of this title.

(e) The Legislature hereby intends to regulate consumer credit reporting agencies pursuant to this title in a manner which will best protect the interests of the people of the State of California.

(f) The extension of credit is a privilege and not a right. Nothing in this title shall preclude a creditor from denying credit to any applicant providing such denial is based on factors not inconsistent with present law.

(g) Any clauses in contracts which prohibit any action required by this title are not in the public interest and shall be considered unenforceable. This shall not invalidate the other terms of such a contract.

history: (History: Amended by Stats. 1982, Ch. 1127, Sec. 1.)

path: 1.6. CONSUMER CREDIT REPORTING AGENCIES ACT > 1. General Provisions


text: This act may be referred to as the Consumer Credit Reporting Agencies Act.

history: (History: Repealed and added by Stats. 1975, Ch. 1271.)

title: 1.6. CONSUMER CREDIT REPORTING AGENCIES ACT


text:
The following terms as used in this title have the meaning expressed in this section:

(a) “Adverse action” means a denial or revocation of credit, a change in the terms of an existing credit arrangement which is adverse to the interests of the consumer, or a refusal to grant credit in substantially the amount or on substantially the terms requested. “Adverse action” includes all of the following:

(1) Any denial of, increase in any charge for, or reduction in the amount of, insurance for personal, family, or household purposes made in connection with the underwriting of insurance.

(2) Any denial of employment or any other decision made for employment purposes which adversely affects any current or prospective employee.

(3) Any action taken, or determination made, with respect to a consumer (A) for an application for an extension of credit, or an application for the hiring of a dwelling unit, and (B) that is adverse to the interests of the consumer.

“Adverse action” does not include (A) a refusal to extend additional credit to a consumer under an existing credit arrangement if (i) the applicant is delinquent or otherwise in default under that credit arrangement or (ii) the additional credit would exceed a credit limit previously established for the consumer or (B) a refusal or failure to authorize an account transaction at a point of sale.

(b) “Consumer” means a natural individual.

(c) “Consumer credit report” means any written, oral, or other communication of any information by a consumer credit reporting agency bearing on a consumer’s credit worthiness, credit standing, or credit capacity, which is used or is expected to be used, or collected in whole or in part, for the purpose of serving as a factor in establishing the consumer’s eligibility for: (1) credit to be used primarily for personal, family, or household purposes, or (2) employment purposes, or (3) hiring of a dwelling unit, as defined in subdivision (c) of Section 1940, or (4) other purposes authorized in Section 1785.11.

The term does not include (1) any report containing information solely as to transactions or experiences between the consumer and the person making the report, (2) any communication of that information or information from a credit application by a consumer that is internal within the organization that is the person making the report or that is made to an entity owned by, or affiliated by corporate control with, that person; provided that the consumer is informed by means of a clear and conspicuous written disclosure that information contained in the credit application may be provided to these persons; however, where a credit application is taken by telephone, disclosure shall initially be given orally at the time the application is taken, and a clear and conspicuous written disclosure shall be made to the consumer in the first written communication to that consumer after the application is taken, (3) any authorization or approval of a specific extension of credit directly or indirectly by the issuer of a credit card or similar device, (4) any report by a person conveying a decision whether to make a specific extension of credit directly or indirectly to a consumer in response to a request by a third party, if the third party advises the consumer of the name and address of the person to whom the request was made and the person makes the disclosures to the consumer required under Section 1785.20, (5) any report containing information solely on a consumer’s character, general reputation, personal characteristics, or mode of living which is obtained through personal interviews with neighbors, friends, or associates of the consumer reported on, or others with whom the consumer is acquainted or who may have knowledge concerning those items of information, (6) any communication about a consumer in connection with a credit transaction which is not initiated by the consumer, between persons who are affiliated (as defined in Section 150 of the Corporations Code) by common ownership or common corporate control (as defined by Section 160 of the Corporations Code), if either of those persons has complied with paragraph (2) of subdivision (b) of Section 1785.20.1 with respect to a prequalifying report from which the information communicated is taken and provided the consumer has consented to the provision and use of the prequalifying report in writing, or (7) any consumer credit report furnished for use in connection with a transaction which consists of an extension of credit to be used solely for a commercial purpose.

(d) “Consumer credit reporting agency” means any person who, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the business of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer credit reports to third parties, but does not include any governmental agency whose records are maintained primarily for traffic safety, law enforcement, or licensing purposes.

(e) “Credit transaction that is not initiated by the consumer” does not include the use of a consumer credit report by an assignee for collection or by a person with which the consumer has an account for purposes of (1) reviewing the account or (2) collecting the account. For purposes of this subdivision, “reviewing the account” includes activities related to account maintenance and monitoring, credit line increases, and account upgrades and enhancements.

(f) “Employment purposes,” when used in connection with a consumer credit report, means a report used for the purpose of evaluating a consumer for employment, promotion, reassignment, or retention as an employee.

(g) “File,” when used in connection with information on any consumer, means all of the information on that consumer recorded and retained by a consumer credit reporting agency, regardless of how the information is stored.

(h) “Firm offer of credit” means any offer of credit to a consumer that will be honored if, based on information in a consumer credit report on the consumer and other information bearing on the creditworthiness of the consumer, the consumer is determined to meet the criteria used to select the consumer for the offer and the consumer is able to provide any real property collateral specified in the offer. For purposes of this subdivision, the phrase “other information bearing on the creditworthiness of the consumer” means information that the person making the offer is permitted to consider pursuant to any rule, regulation, or formal written policy statement relating to the federal Fair Credit Reporting Act, as amended (15 U.S.C. Sec. 1681 et seq.), promulgated by the Federal Trade Commission or any federal bank regulatory agency.

(i) “Item of information” means any of one or more informative entries in a credit report which causes a creditor to deny credit to an applicant or increase the cost of credit to an applicant or deny an applicant a checking account with a bank or other financial institution.

(j) (1) “Medical debt” means a debt owed by a consumer to a person whose primary business is providing medical services, products, or devices, or to the person’s agent or assignee, for the provision of medical services, products, or devices. Medical debt includes, but is not limited to, medical bills that are not past due or that have been paid.

(2) For the purposes of this subdivision, “medical service, product, or device” does not include cosmetic surgery, as defined in Section 1367.63 of the Health and Safety Code, and includes, but is not limited to, all of the following:

(A) Any service, drug, medication, product, or device sold, offered, or provided to a patient by either of the following:

(i) A person or facility licensed under Division 2 (commencing with Section 1200) of the Health and Safety Code, except for Chapters 3.35 (commencing with Section 1596.60) to 3.65 (commencing with Section 1597.70), inclusive, of that division.

(ii) A person licensed under Division 2 (commencing with Section 500) of the Business and Professions Code, except for Chapter 11 (commencing with Section 4800) of that division.

(B) Initial or subsequent reconstructive surgeries, as defined in Section 1367.63 of the Health and Safety Code, and followup care deemed necessary by the attending physician and surgeon.

(C) Initial or subsequent prosthetic devices, as defined in Section 1367.635 of the Health and Safety Code, and followup care deemed necessary by the attending physician and surgeon.

(D) A mastectomy, as defined in Section 1367.635 of the Health and Safety Code.

(k) “Person” means any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity.

(l) “Prequalifying report” means a report containing the limited information permitted under paragraph (2) of subdivision (b) of Section 1785.11.

(m) “State or local child support enforcement agency” means the Department of Child Support Services or local child support agency acting pursuant to Division 17 (commencing with Section 17000) of the Family Code to establish, enforce or modify child support obligations, and any state or local agency or official that succeeds to these responsibilities under a successor statute.

history: (History: Amended by Stats. 2024, Ch. 520, Sec. 1. (SB 1061) Effective January 1, 2025.)


text: Nothing in this title shall apply to any person licensed pursuant to the provisions of Chapter 11 (commencing with Section 7500) of Division 3 of the Business and Professions Code, or to any employee of such person, unless such person is employed directly by a consumer credit reporting agency.


text: Any person who, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling, evaluating, or disseminating information on the checking account experiences of consumer customers of banks or other financial institutions is, with the exception of compliance with the requirements of Section 1785.10, subdivisions (c), (d), and (e), only with regard to the provision of the address and telephone number, subject to the same laws which govern consumer credit reporting agencies.

history: (History: Amended by Stats. 2001, Ch. 236, Sec. 1. Effective January 1, 2002. Operative January 1, 2003, by Sec. 3 of Ch. 236.)


text: The notices and disclosures to consumers provided for in this title shall be required to be made only to those consumers who have a mailing address in California.

history: (History: Added by Stats. 1993, Ch. 285, Sec. 2. Effective August 2, 1993.)


text:
(a) Every consumer credit reporting agency shall, upon request and proper identification of any consumer, allow the consumer to visually inspect all files maintained regarding that consumer at the time of the request.

(b) Every consumer reporting agency, upon contact by a consumer by telephone, mail, or in person regarding information which may be contained in the agency files regarding that consumer, shall promptly advise the consumer of his or her rights under Sections 1785.11.8, 1785.19, and 1785.19.5, and of the obligation of the agency to provide disclosure of the files in person, by mail, or by telephone pursuant to Section 1785.15, including the obligation of the agency to provide a decoded written version of the file or a written copy of the file with an explanation of any code, including any credit score used, and the key factors, as defined in Section 1785.15.1, if the consumer so requests that copy. The disclosure shall be provided in the manner selected by the consumer, chosen from among any reasonable means available to the consumer credit reporting agency.

The agency shall determine the applicability of subdivision (1) of Section 1785.17 and, where applicable, the agency shall inform the consumer of the rights under that section.

(c) All information on a consumer in the files of a consumer credit reporting agency at the time of a request for inspection under subdivision (a), shall be available for inspection, including the names, addresses and, if provided by the sources of information, the telephone numbers identified for customer service for the sources of information.

(d) (1) The consumer credit reporting agency shall also disclose the recipients of any consumer credit report on the consumer which the consumer credit reporting agency has furnished:

(A) For employment purposes within the two-year period preceding the request.

(B) For any other purpose within the 12-month period preceding the request.

(2) Disclosure of recipients of consumer credit reports for purposes of this subdivision shall include the name of the recipient or, if applicable, the fictitious business name under which the recipient does business disclosed in full. The identification shall also include the address and, if provided by the recipient, the telephone number identified for customer service for the recipient.

(e) The consumer credit reporting agency shall also disclose a record of all inquiries received by the agency in the 12-month period preceding the request that identified the consumer in connection with a credit transaction which is not initiated by the consumer. This record of inquiries shall include the name, address and, if provided by the recipient, the telephone number identified for customer service for each recipient making an inquiry.

(f) Any consumer credit reporting agency when it is subject to the provisions of Section 1785.22 is exempted from the requirements of subdivisions (c), (d), and (e), only with regard to the provision of the address and telephone number.

(g) Any consumer credit reporting agency, that provides a consumer credit report to another consumer credit reporting agency that procures the consumer credit report for the purpose of resale and is subject to Section 1785.22, is exempted from the requirements of subdivisions (d) and (e), only with regard to the provision of the address and telephone number regarding each prospective user to which the consumer credit report was sold.

(h) This section shall become operative on January 1, 2003.

history: (History: Repealed (in Sec. 1) and added by Stats. 2002, Ch. 9, Sec. 2. Effective February 19, 2002. Section operative January 1, 2003, by its own provisions.)

path: 1.6. CONSUMER CREDIT REPORTING AGENCIES ACT > 2. Obligations of Consumer Credit Reporting Agencies


text:
(a) It is unlawful for a consumer credit reporting agency to prohibit in any manner, including, but not limited to, in the terms of a contract enforceable in the state, or to dissuade or attempt to dissuade, a user of a consumer credit report furnished by the credit reporting agency from providing a copy of the consumer’s credit report to the consumer, upon the consumer’s request, if the user has taken adverse action against the consumer based in whole or in part upon information in the report.

(b) The Attorney General, any district attorney or city attorney, or a city prosecutor in any city or city and county having a full-time city prosecutor, may bring a civil action in any court of competent jurisdiction against any credit reporting agency violating this section for a civil penalty not to exceed five thousand dollars ($5,000) which may be assessed and recovered in a civil action brought in the name of the people of the State of California.

history: (History: Added by Stats. 2013, Ch. 433, Sec. 1. (AB 1220) Effective January 1, 2014.)

chapter: 2. Obligations of Consumer Credit Reporting Agencies


text:
(a) A consumer credit reporting agency shall furnish a consumer credit report only under the following circumstances:

(1) In response to the order of a court having jurisdiction to issue an order.

(2) In accordance with the written instructions of the consumer to whom it relates.

(3) To a person whom it has reason to believe:

(A) Intends to use the information in connection with a credit transaction, or entering or enforcing an order of a court of competent jurisdiction for support, involving the consumer as to whom the information is to be furnished and involving the extension of credit to, or review or collection of an account of, the consumer; or

(B) Intends to use the information for employment purposes; or

(C) Intends to use the information in connection with the underwriting of insurance involving the consumer, or for insurance claims settlements; or

(D) Intends to use the information in connection with a determination of the consumer’s eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider the applicant’s financial responsibility or status; or

(E) Intends to use the information in connection with the hiring of a dwelling unit, as defined in subdivision (c) of Section 1940; or

(F) Otherwise has a legitimate business need for the information in connection with a business transaction involving the consumer.

(b) A consumer credit reporting agency may furnish information for purposes of a credit transaction specified in subparagraph (A) of paragraph (3) of subdivision (a), where it is a credit transaction that is not initiated by the consumer, only under the circumstances specified in paragraph (1) or (2), as follows:

(1) The consumer authorizes the consumer credit reporting agency to furnish the consumer credit report to the person.

(2) The proposed transaction involves a firm offer of credit to the consumer, the consumer credit reporting agency has complied with subdivision (d), and the consumer has not elected pursuant to paragraph (1) of subdivision (d) to have the consumer’s name excluded from lists of names provided by the consumer credit reporting agency for purposes of reporting in connection with the potential issuance of firm offers of credit. A consumer credit reporting agency may provide only the following information pursuant to this paragraph:

(A) The name and address of the consumer.

(B) Information pertaining to a consumer that is not identified or identifiable with a particular consumer.

(c) Except as provided in paragraph (3) of subdivision (a) of Section 1785.15, a consumer credit reporting agency shall not furnish to any person a record of inquiries solely resulting from credit transactions that are not initiated by the consumer.

(d) (1) A consumer may elect to have his or her name and address excluded from any list provided by a consumer credit reporting agency pursuant to paragraph (2) of subdivision (b) by notifying the consumer credit reporting agency, by telephone or in writing, through the notification system maintained by the consumer credit reporting agency pursuant to subdivision (e), that the consumer does not consent to any use of consumer credit reports relating to the consumer in connection with any transaction that is not initiated by the consumer.

(2) An election of a consumer under paragraph (1) shall be effective with respect to a consumer credit reporting agency, and any affiliate of the consumer credit reporting agency, on the date on which the consumer notifies the consumer credit reporting agency.

(3) An election of a consumer under paragraph (1) shall terminate and be of no force or effect following notice from the consumer to the consumer credit reporting agency, through the system established pursuant to subdivision (e), that the election is no longer effective.

(e) Each consumer credit reporting agency that furnishes a prequalifying report pursuant to subdivision (b) in connection with a credit transaction not initiated by the consumer shall establish and maintain a notification system, including a toll-free telephone number, that permits any consumer, with appropriate identification and for which the consumer credit reporting agency has a file, to notify the consumer credit reporting agency of the consumer’s election to have the consumer’s name removed from any list of names and addresses provided by the consumer credit reporting agency, and by any affiliated consumer credit reporting agency, pursuant to paragraph (2) of subdivision (b). Compliance with the requirements of this subdivision by a consumer credit reporting agency shall constitute compliance with those requirements by any affiliate of that consumer credit reporting agency.

(f) Each consumer credit reporting agency that compiles and maintains files on consumers on a nationwide basis shall establish and maintain a notification system under paragraph (1) of subdivision (e) jointly with its affiliated consumer credit reporting agencies.

history: (History: Amended by Stats. 2002, Ch. 664, Sec. 40. Effective January 1, 2003.)


text:
(a) A consumer may elect to place a security alert in his or her credit report by making a request in writing or by telephone to a consumer credit reporting agency. “Security alert” means a notice placed in a consumer’s credit report, at the request of the consumer, that notifies a recipient of the credit report that the consumer’s identity may have been used without the consumer’s consent to fraudulently obtain goods or services in the consumer’s name.

(b) A consumer credit reporting agency shall notify each person requesting consumer credit information with respect to a consumer of the existence of a security alert in the credit report of that consumer, regardless of whether a full credit report, credit score, or summary report is requested.

(c) Each consumer credit reporting agency shall maintain a toll-free telephone number to accept security alert requests from consumers 24 hours a day, seven days a week.

(d) The toll-free telephone number shall be included in any written disclosure by a consumer credit reporting agency to any consumer pursuant to Section 1785.15 and shall be printed in a clear and conspicuous manner.

(e) A consumer credit reporting agency shall place a security alert on a consumer’s credit report no later than five business days after receiving a request from the consumer.

(f) The security alert shall remain in place for at least 90 days, and a consumer shall have the right to request a renewal of the security alert.

(g) Any person who uses a consumer credit report in connection with the approval of credit based on an application for an extension of credit, or with the purchase, lease, or rental of goods or non-credit-related services and who receives notification of a security alert pursuant to subdivision (a) may not lend money, extend credit, or complete the purchase, lease, or rental of goods or non-credit-related services without taking reasonable steps to verify the consumer’s identity, in order to ensure that the application for an extension of credit or for the purchase, lease, or rental of goods or non-credit-related services is not the result of identity theft. If the consumer has placed a statement with the security alert in his or her file requesting that identity be verified by calling a specified telephone number, any person who receives that statement with the security alert in a consumer’s file pursuant to subdivision (a) shall take reasonable steps to verify the identity of the consumer by contacting the consumer using the specified telephone number prior to lending money, extending credit, or completing the purchase, lease, or rental of goods or non-credit-related services. If a person uses a consumer credit report to facilitate the extension of credit or for another permissible purpose on behalf of a subsidiary, affiliate, agent, assignee, or prospective assignee, that person may verify a consumer’s identity under this section in lieu of the subsidiary, affiliate, agent, assignee, or prospective assignee.

(h) For purposes of this section, “extension of credit” does not include an increase in the dollar limit of an existing open-end credit plan, as defined in Regulation Z issued by the Board of Governors of the Federal Reserve System (12 C.F.R. 226.2), or any change to, or review of, an existing credit account.

(i) If reasonable steps are taken to verify the identity of the consumer pursuant to subdivision (b) of Section 1785.20.3, those steps constitute compliance with the requirements of this section, except that if a consumer has placed a statement including a telephone number with the security alert in his or her file, his or her identity shall be verified by contacting the consumer using that telephone number as specified pursuant to subdivision (g).

(j) A consumer credit reporting agency shall notify each consumer who has requested that a security alert be placed on his or her consumer credit report of the expiration date of the alert.

(k) Notwithstanding Section 1785.19, any consumer credit reporting agency that recklessly, willfully, or intentionally fails to place a security alert pursuant to this section shall be liable for a penalty in an amount of up to two thousand five hundred dollars ($2,500) and reasonable attorneys’ fees.

history: (History: Amended by Stats. 2003, Ch. 907, Sec. 1.5. Effective January 1, 2004. Operative July 1, 2004, by Sec. 8 of Ch. 907. Note: Previously, the amendment by Stats. 2003, Ch. 533, was operative from Jan. 1 until July 1, 2004, as authorized by Sec. 6 of Stats. 2003, Ch. 907.)


text:
(a) A consumer may elect to place a security freeze on his or her credit report by making a request in writing by mail to a consumer credit reporting agency. “Security freeze” means a notice placed in a consumer’s credit report, at the request of the consumer, and subject to certain exceptions, that prohibits the consumer credit reporting agency from releasing the consumer’s credit report or any information from it without the express authorization of the consumer. If a security freeze is in place, information from a consumer’s credit report may not be released to a third party without prior express authorization from the consumer. This subdivision does not prevent a consumer credit reporting agency from advising a third party that a security freeze is in effect with respect to the consumer’s credit report.

(b) A consumer credit reporting agency shall place a security freeze on a consumer’s credit report no later than three business days after receiving a written request from the consumer.

(c) The consumer credit reporting agency shall send a written confirmation of the security freeze to the consumer within 10 business days and shall provide the consumer with a unique personal identification number or password to be used by the consumer when providing authorization for the release of his or her credit for a specific party or period of time.

(d) If the consumer wishes to allow his or her credit report to be accessed for a specific party or period of time while a freeze is in place, he or she shall contact the consumer credit reporting agency, request that the freeze be temporarily lifted, and provide the following:

(1) Proper identification, as defined in subdivision (c) of Section 1785.15.

(2) The unique personal identification number or password provided by the credit reporting agency pursuant to subdivision (c).

(3) The proper information regarding the third party who is to receive the credit report or the time period for which the report shall be available to users of the credit report.

(e) A consumer credit reporting agency that receives a request from a consumer to temporarily lift a freeze on a credit report pursuant to subdivision (d) shall comply with the request no later than three business days after receiving the request.

(f) A consumer credit reporting agency may develop procedures involving the use of telephone, fax, the Internet, or other electronic media to receive and process a request from a consumer to temporarily lift a freeze on a credit report pursuant to subdivision (d) in an expedited manner.

(g) A consumer credit reporting agency shall remove or temporarily lift a freeze placed on a consumer’s credit report only in the following cases:

(1) Upon consumer request, pursuant to subdivision (d) or (j).

(2) If the consumer’s credit report was frozen due to a material misrepresentation of fact by the consumer. If a consumer credit reporting agency intends to remove a freeze upon a consumer’s credit report pursuant to this paragraph, the consumer credit reporting agency shall notify the consumer in writing prior to removing the freeze on the consumer’s credit report.

(h) A third party who requests access to a consumer credit report in connection with an application for credit or any other use may treat the application as incomplete if a security freeze is in effect and the consumer does not allow his or her credit report to be accessed for that specific party or period of time.

(i) If a consumer requests a security freeze, the consumer credit reporting agency shall disclose the process of placing and temporarily lifting a freeze and the process for allowing access to information from the consumer’s credit report for a specific party or period of time while the freeze is in place.

(j) A security freeze shall remain in place until the consumer requests that the security freeze be removed. A consumer credit reporting agency shall remove a security freeze within three business days of receiving a request for removal from the consumer if the consumer provides both of the following:

(1) Proper identification, as defined in subdivision (c) of Section 1785.15.

(2) The unique personal identification number or password provided by the credit reporting agency pursuant to subdivision (c).

(k) A consumer credit reporting agency shall require proper identification, as defined in subdivision (c) of Section 1785.15, of the person making a request to place or remove a security freeze.

(l) The provisions of this section do not apply to the use of a consumer credit report by any of the following:

(1) (A) (i) A person or entity with which the consumer has or had, prior to any assignment, an account or contract, including a demand deposit account, or to which the consumer issued a negotiable instrument, for the purpose of reviewing the account or collecting the financial obligation owing for the account, contract, or negotiable instrument.

(ii) A subsidiary, affiliate, or agent of a person or entity described in clause (i), an assignee of a financial obligation owing by the consumer to such a person or entity, or a prospective assignee of a financial obligation owing by the consumer to such a person or entity in conjunction with the proposed purchase of the financial obligation, for the purpose of reviewing the account or collecting the financial obligation owing for the account, contract, or negotiable instrument.

(B) For purposes of this paragraph, “reviewing the account” includes activities related to account maintenance, monitoring, credit line increases, and account upgrades and enhancements.

(2) A subsidiary, affiliate, agent, assignee, or prospective assignee of a person to whom access has been granted under subdivision (d) for purposes of facilitating the extension of credit or other permissible use.

(3) Any state or local agency, law enforcement agency, trial court, or private collection agency acting pursuant to a court order, warrant, or subpoena.

(4) A child support agency acting pursuant to Chapter 2 (commencing with Section 17400) of Division 17 of the Family Code or Title IV-D of the Social Security Act (42 U.S.C. et seq.).

(5) The State Department of Health Care Services or its agents or assigns acting to investigate Medi-Cal fraud.

(6) The Franchise Tax Board or its agents or assigns acting to investigate or collect delinquent taxes or unpaid court orders or to fulfill any of its other statutory responsibilities.

(7) The use of credit information for the purposes of prescreening as provided for by the federal Fair Credit Reporting Act.

(8) Any person or entity administering a credit file monitoring subscription service to which the consumer has subscribed.

(9) Any person or entity for the purpose of providing a consumer with a copy of his or her credit report upon the consumer’s request.

(m) (1) Except as provided in paragraph (2), this title does not prevent a consumer credit reporting agency from charging a fee of no more than ten dollars ($10) to a consumer for the placement of each freeze, the removal of the freeze, the temporary lift of the freeze for a period of time, or the temporary lift of the freeze for a specific party, regarding access to a consumer credit report, except that a consumer credit reporting agency may not charge a fee to a victim of identity theft who has submitted a valid police report or valid Department of Motor Vehicles investigative report that alleges a violation of Section 530.5 of the Penal Code.

(2) With respect to a consumer who is 65 years of age or older and who has provided identification confirming his or her age, a consumer credit reporting agency shall not charge a fee for the placement of an initial security freeze, but may charge a fee not to exceed five dollars ($5) for the removal of the freeze, the temporary lift of the freeze for a period of time, the temporary lift of the freeze for a specific party, or replacing the freeze.

(n) Regardless of the existence of a security freeze, a consumer reporting agency may disclose public record information lawfully obtained by, or for, the consumer reporting agency from an open public record to the extent otherwise permitted by law. This subdivision does not prohibit a consumer reporting agency from electing to apply a valid security freeze to the entire contents of a credit report.

history: (History: Amended by Stats. 2012, Ch. 645, Sec. 1. (AB 2374) Effective January 1, 2013.)


text:
(a) If a security freeze is in place, a consumer credit reporting agency shall not change any of the following official information in a consumer credit report without sending a written confirmation of the change to the consumer within 30 days of the change being posted to the consumer’s file: name, date of birth, social security number, and address. Written confirmation is not required for technical modifications of a consumer’s official information, including name and street abbreviations, complete spellings, or transposition of numbers or letters. In the case of an address change, the written confirmation shall be sent to both the new address and to the former address.

(b) If a consumer has placed a security alert, a consumer credit reporting agency shall provide the consumer, upon request, with a free copy of his or her credit report at the time the 90-day security alert period expires.

history: (History: Added by Stats. 2001, Ch. 720, Sec. 3. Effective January 1, 2002. Operative January 1, 2003, by Sec. 8 of Ch. 720.)


text: The provisions of Sections 1785.11.1, 1785.11.2, and 1785.11.3 do not apply to a consumer credit reporting agency that acts only as a reseller of credit information pursuant to Section 1785.22 by assembling and merging information contained in the data base of another consumer credit reporting agency or multiple consumer credit reporting agencies, and does not maintain a permanent data base of credit information from which new consumer credit reports are produced. However, a consumer credit reporting agency acting pursuant to Section 1785.22 shall honor any security freeze placed on a consumer credit report by another consumer credit reporting agency.

history: (History: Added by Stats. 2001, Ch. 720, Sec. 4. Effective January 1, 2002.)


text:
The following entities are not required to place in a credit report either a security alert, pursuant to Section 1785.11.1, or a security freeze, pursuant to Section 1785.11.2:

(a) A check services or fraud prevention services company, which issues reports on incidents of fraud or authorizations for the purpose of approving or processing negotiable instruments, electronic funds transfers, or similar methods of payments.

(b) A deposit account information service company, which issues reports regarding account closures due to fraud, substantial overdrafts, ATM abuse, or similar negative information regarding a consumer, to inquiring banks or other financial institutions for use only in reviewing a consumer request for a deposit account at the inquiring bank or financial institution.

history: (History: Amended by Stats. 2003, Ch. 907, Sec. 2. Effective January 1, 2004.)


text: A consumer may elect that his or her name shall be removed from any list that a consumer credit reporting agency furnishes for credit card solicitations, by notifying the consumer credit reporting agency, by telephone or in writing, pursuant to the notification system maintained by the consumer credit reporting agency pursuant to subdivision (d) of Section 1785.11. The election shall be effective for a minimum of two years, unless otherwise specified by the consumer.

history: (History: Added by Stats. 2001, Ch. 354, Sec. 2. Effective January 1, 2002.)


text:
For purposes of Sections 1785.11.10 and 1785.11.11, the following terms shall have the following meanings:

(a) “Protected consumer” means an individual who is any of the following:

(1) Under 16 years of age at the time a request for the placement of a security freeze is made.

(2) An incapacitated person or a protected person for whom a guardian or conservator has been appointed.

(3) Under the jurisdiction of a county welfare department or county probation department, has been placed in a foster care setting, and is under 16 years of age at the time a request for placement of a security freeze is made.

(b) “Record” means a compilation of information that:

(1) Identifies a protected consumer.

(2) Was created by a consumer credit reporting agency solely for the purpose of complying with this section.

(3) Is not otherwise authorized to be created or used to consider the protected consumer’s creditworthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living.

(c) (1) “Representative” means a person who provides to a consumer credit reporting agency sufficient proof of authority to act on behalf of a protected consumer.

(2) For a protected consumer who has been placed in a foster care setting, “representative” means either of the following:

(A) A county welfare department or its agent or designee.

(B) A county probation department or its agent or designee.

(3) For a protected consumer who has been placed in a foster care setting, “representative” does not mean a foster parent.

(d) “Security freeze” means:

(1) If a consumer credit reporting agency does not have a file pertaining to a protected consumer, a restriction that:

(A) Is placed on the protected consumer’s record in accordance with this section.

(B) Prohibits the consumer credit reporting agency from releasing the protected consumer’s record except as authorized in this section.

(2) If a consumer credit reporting agency has a file pertaining to a protected consumer, a restriction that:

(A) Is placed on the protected consumer’s consumer credit report in accordance with this section.

(B) Prohibits the consumer credit reporting agency from releasing the protected consumer’s consumer credit report or any information derived from the protected consumer’s consumer credit report except as authorized in this section.

(e) “Sufficient proof of authority” means documentation that shows that a representative has authority to act on behalf of a protected consumer in a financial matter. This documentation includes, but is not limited to:

(1) A court order or relevant enabling document issued by a court.

(2) A legally sufficient and valid power of attorney, or a durable power of attorney.

(3) A written, notarized statement signed by a representative that expressly describes the authority of the representative to act on behalf of a protected consumer, including a temporary conservator or temporary guardian.

(4) A written communication from a county welfare department or its agent or designee or a county probation department or its agent or designee certifying that the protected consumer is a foster youth under its jurisdiction.

(f) “Sufficient proof of identification” means information or documentation that identifies a protected consumer or a representative of a protected consumer. This information or documentation includes, but is not limited to:

(1) A social security number or a copy of a social security card issued by the Social Security Administration.

(2) A certified copy or official copy of a birth certificate issued by the entity authorized to issue the birth certificate.

(3) A copy of a driver’s license, an identification issued by the Department of Motor Vehicles, or any other government-issued identification.

(4) A copy of a bill for telephone, sewer, septic tank, water, electric, oil, or natural gas services that shows a name and a home address.

(5) A written communication from a county welfare department or its agent or designee or a county probation department or its agent or designee certifying that the protected consumer is a foster youth under its jurisdiction.

history: (History: Added by Stats. 2016, Ch. 494, Sec. 1. (AB 1580) Effective January 1, 2017.)


text:
Sections 1785.11.9 to 1785.11.11, inclusive, do not apply to the use of a protected consumer’s consumer credit report or record by any of the following:

(a) A person or entity listed in paragraph (1) or (2) of subdivision (l) of Section 1785.11.2, or Section 1785.11.4 or 1785.11.6.

(b) A person administering a credit file monitoring subscription service to which the representative of the protected consumer has subscribed on behalf of the protected consumer.

(c) A person who provides the protected consumer or the protected consumer’s representative with a copy of the protected consumer’s consumer credit report at the request of the protected consumer or at the request of the protected consumer’s representative.

(d) Any state or local agency, law enforcement agency, trial court, or private collection agency acting pursuant to a court order, warrant, or subpoena.

(e) A child support agency acting pursuant to Chapter 2 (commencing with Section 17400) of Division 17 of the Family Code and Title IV-D of the Social Security Act (42 U.S.C. Sec. 651 et seq.).

(f) The State Department of Health Care Services or its agents or assigns acting to investigate Medi-Cal fraud.

(g) The Franchise Tax Board or its agents or assigns acting to investigate or collect delinquent taxes or unpaid court orders or to fulfill any of its other statutory responsibilities.

history: (History: Added by Stats. 2016, Ch. 494, Sec. 2. (AB 1580) Effective January 1, 2017.)


text:
(a) (1) A consumer credit reporting agency shall place a security freeze for a protected consumer if both of the following occur:

(A) The consumer credit reporting agency receives a request from the protected consumer’s representative for the placement of the security freeze pursuant to this section.

(B) The protected consumer’s representative does all of the following:

(i) Submits the request to the consumer credit reporting agency at the address or other point of contact and in the manner specified by the consumer credit reporting agency.

(ii) Provides to the consumer credit reporting agency sufficient proof of identification of the protected consumer and the representative.

(iii) Provides to the consumer credit reporting agency sufficient proof of authority to act on behalf of the protected consumer.

(iv) Pays to the consumer credit reporting agency a fee as authorized by subdivision (i).

(2) (A) If the request for the placement or removal of a security freeze is for a protected consumer who has been placed in a foster care setting, the credit reporting agency shall deem the requirements of clauses (ii) and (iii) of subparagraph (B) of paragraph (1) to have been met if the request is from a county welfare department or a county probation department appearing on the most recent list provided or available to a consumer credit reporting agency by the State Department of Social Services and the requesting entity provides sufficient proof of identification under 15 U.S.C. Sec. 1681c-1(j)(1)(G). A county welfare department or county probation department shall not have the authority to request a security freeze for a protected consumer placed in foster care that continues beyond the protected consumer’s 18th birthday. A consumer credit reporting agency may use whatever lawful mechanism is available to it, including mechanisms for thawing or unfreezing reports by dates certain, to ensure the freeze does not extend beyond a protected consumer’s 18th birthday.

(B) Notwithstanding any other law, the State Department of Social Services may, at the request of a consumer credit reporting agency, provide or, in the State Department of Social Service’s discretion, otherwise make available to consumer reporting agencies in any other manner, a list of county welfare departments or county probation departments whose employees may be representatives of protected consumers who have been placed in a foster care setting.

(b) If a consumer credit reporting agency does not have a file pertaining to a protected consumer when the consumer credit reporting agency receives a request pursuant to paragraph (1) of subdivision (a), the consumer credit reporting agency shall create a record for the protected consumer.

(c) If a protected consumer’s representative requests a security freeze, the consumer credit reporting agency shall disclose the process for placing and removing a security freeze.

(d) Within 30 days after receiving a request that meets the requirements of subdivision (a), a consumer credit reporting agency shall place a security freeze for the protected consumer. The consumer credit reporting agency shall send written confirmation of the security freeze to the address on file within 10 days of the placement of the security freeze.

(e) Unless a security freeze for a protected consumer is removed pursuant to subdivision (h) or (j), a consumer credit reporting agency shall not release the protected consumer’s consumer credit report, any information derived from the protected consumer’s consumer credit report, or any record created for the protected consumer.

(f) A security freeze for a protected consumer placed pursuant to this section shall remain in effect until either of the following occurs:

(1) The protected consumer or the protected consumer’s representative requests that the consumer credit reporting agency remove the security freeze in accordance with subdivision (h).

(2) The security freeze is removed in accordance with subdivision (j).

(g) To remove a security freeze, a protected consumer or a protected consumer’s representative shall do all of the following:

(1) Submit a request for removal of the security freeze to the consumer credit reporting agency at the address or other point of contact and in the manner specified by the consumer credit reporting agency.

(2) Provide to the consumer credit reporting agency:

(A) If the request is made by the protected consumer:

(i) Proof that the sufficient proof of authority for the protected consumer’s representative to act on behalf of the protected consumer is no longer valid, they have been emancipated, or they are 16 years of age or older.

(ii) Sufficient proof of identification of the protected consumer.

(B) If the request is made by the representative of a protected consumer:

(i) Sufficient proof of identification of the protected consumer and the representative.

(ii) Sufficient proof of authority to act on behalf of the protected consumer.

(3) Pay to the consumer credit reporting agency a fee as authorized by subdivision (i).

(h) Within 30 days after receiving a request that meets the requirements of subdivision (g), a consumer credit reporting agency shall remove a security freeze for a protected consumer.

(i) (1) Except as provided in paragraph (2), a consumer credit reporting agency may not charge a fee for any service performed pursuant to this section.

(2) A consumer credit reporting agency is authorized to charge a reasonable fee, not exceeding ten dollars ($10), for each placement or removal of a security freeze for a protected consumer.

(3) Notwithstanding paragraph (2), a consumer credit reporting agency shall not charge any fee pursuant to this section under any of the following circumstances:

(A) The protected consumer’s representative has received a report of alleged identity theft against the protected consumer under Section 530.5 of the Penal Code and has provided copy of the report to the consumer credit reporting agency.

(B) The request for the placement or removal of a security freeze is for a protected consumer who is under 16 years of age at the time of the request and the consumer credit reporting agency has a report pertaining to the protected consumer.

(C) The request for the placement or removal of a security freeze is for a protected consumer who has been placed in a foster care setting.

(j) (1) A consumer credit reporting agency is authorized to remove a security freeze for a protected consumer or to delete a record of a protected consumer if the security freeze was placed or the record was created based upon a material misrepresentation of fact by the protected consumer or the protected consumer’s representative.

(2) With respect to a security freeze placed for a protected consumer under paragraph (2) of subdivision (a), the freeze may be removed prior to the protected consumer’s 18th birthday at the request of the representative of the protected consumer, or by the protected consumer if the protected consumer is 16 years of age or older at the time they make the request, under any of the following circumstances:

(A) Upon the protected consumer’s removal from foster care.

(B) Upon the protected consumer’s request, if the protected consumer is 16 years of age or older.

(C) Upon a determination by the representative of the protected consumer that removal of the security freeze is in the best interest of the protected consumer.

(3) A representative of the protected consumer may also remove the freeze pursuant to paragraph (2) at a time when the representative inquires with each of the three major credit reporting agencies pursuant to paragraph (1) of subdivision (a) of Section 10618.6 of the Welfare and Institutions Code.

(k) A consumer credit reporting agency may develop procedures involving the use of telephone, mail, fax, the internet, or other electronic media to receive and process a request for a protected consumer’s security freeze to be placed or removed.

history: (History: Amended by Stats. 2025, Ch. 67, Sec. 25. (AB 1170) Effective January 1, 2026.)


text:
(a) Notwithstanding the provisions of Section 1785.11, a consumer credit reporting agency may furnish to a governmental agency a consumer’s name, address, former address, places of employment, or former places of employment.

(b) If a request received pursuant to subdivision (a) of Section 10618.6 of the Welfare and Institutions Code indicates that the protected consumer who has been placed in a foster care setting has a consumer credit history, any information that appears on the protected consumer’s credit report shall be promptly blocked and not reported, in the same manner set forth in subdivision (k) of Section 1785.16 as if the agency had received a police report pursuant to Section 530.5 of the Penal Code. The credit reporting agency shall also comply with subdivisions (k) and (l) of Section 1785.16, regarding the protected consumer who has been placed in a foster care setting.

history: (History: Amended by Stats. 2024, Ch. 846, Sec. 2. (AB 2935) Effective January 1, 2025.)


text:
(a) No consumer credit reporting agency shall make any consumer credit report containing any of the following items of information:

(1) Bankruptcies that, from the date of the order for relief, antedate the report by more than 10 years.

(2) Suits and judgments that, from the date of entry or renewal, antedate the report by more than seven years or until the governing statute of limitations has expired, whichever is the longer period.

(3) Unlawful detainer actions, unless the lessor was the prevailing party. For purposes of this paragraph, the lessor shall be deemed to be the prevailing party only if (A) final judgment was awarded to the lessor (i) upon entry of the tenant’s default, (ii) upon the granting of the lessor’s motion for summary judgment, or (iii) following trial, or (B) the action was resolved by a written settlement agreement between the parties that states that the unlawful detainer action may be reported. In any other instance in which the action is resolved by settlement agreement, the lessor shall not be deemed to be the prevailing party for purposes of this paragraph.

(4) Paid tax liens that, from the date of payment, antedate the report by more than seven years.

(5) Accounts placed for collection or charged to profit and loss that antedate the report by more than seven years.

(6) Records of arrest, indictment, information, misdemeanor complaint, or conviction of a crime that, from the date of disposition, release, or parole, antedate the report by more than seven years. These items of information shall no longer be reported if at any time it is learned that in the case of a conviction a full pardon has been granted, or in the case of an arrest, indictment, information, or misdemeanor complaint a conviction did not result.

(7) Medical debt.

(8) Any other adverse information that antedates the report by more than seven years.

(b) The seven-year period specified in paragraphs (5) and (8) of subdivision (a) shall commence to run, with respect to any account that is placed for collection (internally or by referral to a third party, whichever is earlier), charged to profit and loss, or subjected to any similar action, upon the expiration of the 180-day period beginning on the date of the commencement of the delinquency that immediately preceded the collection activity, charge to profit and loss, or similar action. Where more than one of these actions is taken with respect to a particular account, the seven-year period specified in paragraphs (5) and (8) shall commence concurrently for all these actions on the date of the first of these actions.

(c) Any consumer credit reporting agency that furnishes a consumer credit report containing information regarding any case involving a consumer arising under the bankruptcy provisions of Title 11 of the United States Code shall include an identification of the chapter of Title 11 of the United States Code under which the case arose if that can be ascertained from what was provided to the consumer credit reporting agency by the source of the information.

(d) A consumer credit report shall not include any adverse information concerning a consumer antedating the report by more than 10 years or that otherwise is prohibited from being included in a consumer credit report.

(e) If a consumer credit reporting agency is notified by a furnisher of credit information that an open-end credit account of the consumer has been closed by the consumer, any consumer credit report thereafter issued by the consumer credit reporting agency with respect to that consumer, and that includes information respecting that account, shall indicate the fact that the consumer has closed the account. For purposes of this subdivision, “open-end credit account” does not include any demand deposit account, such as a checking account, money market account, or share draft account.

(f) Consumer credit reporting agencies shall not include medical information in their files on consumers or furnish medical information for employment, insurance, or credit purposes in a consumer credit report without the consent of the consumer.

(g) A consumer credit reporting agency shall include in any consumer credit report information, if any, on the failure of the consumer to pay overdue child or spousal support, where the information either was provided to the consumer credit reporting agency pursuant to Section 4752 or has been provided to the consumer credit reporting agency and verified by another federal, state, or local governmental agency.

history: (History: Amended by Stats. 2024, Ch. 520, Sec. 2. (SB 1061) Effective January 1, 2025.)


text:
(a) Every consumer credit reporting agency shall maintain reasonable procedures designed to avoid violations of Section 1785.13 and to limit furnishing of consumer credit reports to the purposes listed under Section 1785.11. These procedures shall require that prospective users of the information identify themselves, certify the purposes for which the information is sought and certify that the information will be used for no other purposes. From the effective date of this act the consumer credit reporting agency shall keep a record of the purposes as stated by the user. Every consumer credit reporting agency shall make a reasonable effort to verify the identity of a new prospective user and the uses certified by the prospective user prior to furnishing the user a consumer report. No consumer credit reporting agency may furnish a consumer credit report to any person unless the consumer credit reporting agency has reasonable grounds for believing that the consumer credit report will be used by the person for the purposes listed in Section 1785.11. A consumer credit reporting agency does not have reasonable grounds for believing that a consumer credit report will be used by the person for the purposes listed in Section 1785.11 unless all of the following requirements are met:

(1) If the prospective user is a retail seller, as defined in Section 1802.3, and intends to issue credit to a consumer who appears in person on the basis of an application for credit submitted in person, the consumer credit reporting agency shall, with a reasonable degree of certainty, match at least three categories of identifying information within the file maintained by the consumer credit reporting agency on the consumer with the information provided to the consumer credit reporting agency by the retail seller. The categories of identifying information may include, but are not limited to, first and last name, month and date of birth, driver’s license number, place of employment, current residence address, previous residence address, or social security number. The categories of information shall not include mother’s maiden name.

(2) If the prospective user is a retail seller, as defined in Section 1802.3, and intends to issue credit to a consumer who appears in person on the basis of an application for credit submitted in person, the retail seller certifies, in writing, to the consumer credit reporting agency that it instructs its employees and agents to inspect a photo identification of the consumer at the time the application was submitted in person. This paragraph does not apply to an application for credit submitted by mail.

(3) If the prospective user intends to extend credit by mail pursuant to a solicitation by mail, the extension of credit shall be mailed to the same address as on the solicitation unless the prospective user verifies any address change by, among other methods, contacting the person to whom the extension of credit will be mailed.

(b) Whenever a consumer credit reporting agency prepares a consumer credit report, it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates. These reasonable procedures shall include, but not be limited to, permanent retention by the consumer credit reporting agency in the consumer’s file, or a separately individualized file, of that portion of the data in the file that is used by the consumer credit reporting agency to identify the individual consumer pursuant to paragraph (1) of subdivision (a). This permanently retained data shall be available for use in either a reinvestigation pursuant to subdivision (a) of Section 1785.16, an investigation where the consumer has filed a police report pursuant to subdivision (k) of Section 1785.16, or a restoration of a file involving the consumer. If the permanently retained identifying information is retained in a consumer’s file, it shall be clearly identified in the file in order for an individual who reviews the file to easily distinguish between the permanently stored identifying information and any other identifying information that may be a part of the file. This retention requirement shall not apply to data that is reported in error, that is obsolete, or that is found to be inaccurate through the results of a reinvestigation initiated by a consumer pursuant to subdivision (a) of Section 1785.16.

(c) No consumer credit reporting agency may prohibit any user of any consumer credit report furnished by the consumer credit reporting agency from disclosing the contents of the consumer credit report to the consumer who is the subject of the report if adverse action may be taken by the user based in whole or in part on the consumer credit report. The act of disclosure to the consumer by the user of the contents of a consumer credit report shall not be a basis for liability of the consumer credit reporting agency or the user under Section 1785.31.

(d) A consumer credit reporting agency shall provide a written notice to any person who regularly and in the ordinary course of business supplies information to the consumer credit reporting agency concerning any consumer or to whom a consumer credit report is provided by the consumer credit reporting agency. The notice shall specify the person’s obligations under this title. Copies of the appropriate code sections shall satisfy the requirement of this subdivision.

history: (History: Amended by Stats. 1997, Ch. 768, Sec. 1. Effective January 1, 1998. Operative July 1, 1998, by Sec. 7 of Ch. 768.)